Qantas takes fight to premium lounges

The battle between
Qantas Airways
and
Virgin Australia
for corporate accounts has shifted to a new front: exclusive premium lounges in Melbourne.

The Australian Financial Review understands Qantas has closed its invitation-only Chairman’s Lounge in Melbourne for up to three months as it improves the facility to bring it in line with superior offerings in Sydney and Canberra.

It comes as Virgin is understood to be planning to open a branch of its own top-tier, invitation-only lounge, “The Club" at Melbourne Airport within the next six months. Branches of The Club have already opened in Sydney, Brisbane and Canberra as Virgin looks to lure away lucrative corporate travel accounts from Qantas.

The Chairman’s Lounge is an invitation-only product with all 7000 memberships personally approved by Qantas chairman
Leigh Clifford
for a two-year period. High-profile executives, board members and politicians are among the members of the discreet club which includes food offerings designed by Rockpool’s
Neil Perry
.

The product is designed to help convince decision-makers to keep their company’s corporate travel account with Qantas. Alternative arrangements will be made for members in Melbourne while the lounge is renovated.

Andrew Kelly
, the Australasian regional director for the Association of Corporate Travel Executives said the Chairman’s Lounge had traditionally proven a powerful lure for corporate business, even at times when companies are focused on cutting costs.

“Captains can mix with other captains of corporate Australia in the lounges," he said. “[A change in airline accounts] can be overridden by the executive level based on those memberships alone. I definitely see why Qantas leverages it hard."

Qantas and Virgin have been battling to secure corporate travel accounts since Virgin chief executive
John Borghetti
launched his “Game Change" strategy of taking his airline upmarket in 2010. Mr Borghetti used to oversee the Chairman’s Lounge in a previous executive role at Qantas.